CIO as Producer, API as Lego Blocks

Tuesday, August 7, 2012 | comments

Today’s CIO has many roles, from business strategist to innovative intrepreneur, from technology visionary to talent master, now, we may need add a new one: a producer, not for TV show, but for digital business services, as IT turns to be a platform for co-creation and digital engagement via an agile IT architecture with speed. A recent released API business value report from PWC may help CIOs gain some insight on being a successful producer:

1. Architecture with Speed

 API is the acronym for application programming interface, a technology term that means the specifications for how software programs are able to exchange information with each other even if designed and run by different organizations.

First of all, CIOs should understand that using APIs is an architectural choice, not a technology choice, second, a relatively new style of APIs, called representational state transfer (RESTful) APIs, which is pull-centric, not the traditional push model,  inspires the new architecture and platform thinking, the goal is to architect a collaborative environment for co-creation, it need be part of IT strategy, as it’s high level architectural change, and it takes audacious IT leadership. 

The new architectural principle and programming model based on RESTful APIs reduces integration cost and complexity, so integrations can scale for many internal as well as external uses. Statistics suggests that using [RESTful] APIs reduces development time by 50 to 75 percent. As SOA has largely remained internally focused, RESTful APIs, sharply reduce the cost and complexity of integrations, deliver a scalable approach for both internal and external use, also accumulate less technical debt for every new piece of functionality created.

From a few user case studies, RESTful API interfaces build up the modular capabilities,  create a level of simplicity that didn’t exist previously, and simplicity speeds things up, making integrations cost-effective.

2. Running IT as Software Company

 IT has to adapt to faster business tempo today, CIO leadership must keep a balance in this evolution and manage IT assets in new ways. The advice to CIOs is to approach the evolution in five dimensions:

  • Business Strategy & Purpose: Framing a customer-centric enterprise via  digitization is a significant transformation facing many organizations today, from IT perspective, most IT organizations spend way too much time building applications and not focusing on the customers, to quote Drucker: “ the purpose of business is to create a customer”.

  • Business Capability Orchestration:  Loosely coupled modular capabilities: means the use of open software interfaces on modular capabilities to allow easy digital connections with other capabilities, internal capabilities and processes are broken into modular service components that have standard open interfaces. Business capabilities and assets inside the enterprise are easily combined with assets and capabilities outside the enterprise.  Loose coupling makes it possible to change the components without affecting the system, as long as the interface is kept stable.

  • Developer community management: The ability to co-create in a digital ecosystem—A co-creation strategy treats customers, channel partners, suppliers, and industry ecosystem participants as active agents who have permission to combine the modular capabilities exposed in a platform to create new experiences. Sophisticated enterprises are starting to think more like a software company—as a platform and an ecosystem. This increase in APIs has led to the need for tools and services that help companies create, publish, manage, operate, and analyze APIs.

  • CIO as Producer: not producing movies or TV shows, but for producing digital services;  IT don’t have to do all the coding anymore. The key role for IT is to be the owner, producer, and platform of the services. Business units, even third parties, can use the services to develop a new capability. The CIO organization therefore will become an orchestrator of services—across vendor capabilities, published services, and consumed services—a role that the new architecture will need to acknowledge and enable.

  • Analytics and reporting:  Analytics helps companies understand and improve the value of their APIs. Value driven analytics gauge API adoption by measuring traffic, purchases, and registrations. With API traffic control tools, companies can define and enforce levels of partner access to data consumption. API analytics tools can also help diagnose performance and scalability issues associated with API platform growth.

 3. SMAC Embraces RESTful APIs

Today’s business leaders are capitalizing and operating on digital ecosystems that are expanding due to the confluence of social networks, mobile computing, analytics, and cloud computing (SMAC). SMAC also provides unprecedented opportunities for enterprises to take advantage of the innovative disruptions.

SMAC represents an acceleration of change that is overwhelming to the current IT approach of owning the end-to-end experience. Today’s methods do not scale to address the challenges that SMAC presents: too many variations in use cases and too many endpoints. In addition to understanding and having strategies for these individual SMAC
technologies, enterprises should look at abstractions that bring together these technologies where they intersect. RESTful APIs have been used as key enabler of such digital connector, creates significant new opportunities for enterprises to transform internally to a digital operating model and to engage externally with the evolving digital ecosystems.

The APIs bring up the reality that there are just too many niches solutions that customers need to be served. No business will be able to do all of the scenarios. In a digital world, an API is a good interface to enable many distribution channels. The best designed APIs are designed for a public audience, in order to get value among the long tail of developers

In conclusion, CIO need craft a good strategy on how the businesses participate in digital channels via taking advantage of APIs, CIOs have many things to experiment these days, they need to know how to integrate services in the cloud. They’ll need to understand how to deploy using APIs, they also need use social/mobile platform to engage customers and employees, analyze Big Data to capture business insight, hopefully APIs are such lego blocks to help shape an Agile social Enterprise.
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